Qatar wants a slice of China's huge aviation market

Qatar Airways is buying into the one market no major airline can ignore: mainland China.The state-own...

Posted: Jan 2, 2019 4:11 PM
Updated: Jan 2, 2019 4:11 PM

Qatar Airways is buying into the one market no major airline can ignore: mainland China.

The state-owned Gulf airline said Wednesday that it has acquired 5% of China Southern Airlines (ZNH), the country's largest carrier. US rivals American Airlines (AAL) and Delta (DAL) already have stakes in China Southern and China Eastern (CEA), respectively.

Asia

Aviation and aerospace industry

Business and industry sectors

Business, economy and trade

China

Continents and regions

East Asia

Middle East

Middle East and North Africa

Qatar

Air transportation

Airlines

Transportation and warehousing

Companies

Qatar Airways

China Southern Airlines

Akbar Al Baker

Business figures

Qatar Airways said it acquired its stake by purchasing China Southern shares on the Hong Kong and Shanghai stock markets. It's the first major investment in mainland China by Qatar Airways.

Akbar Al Baker, the CEO of Qatar Airways, said the investment offered "massive potential."

"China Southern Airlines is one of the most prestigious airlines in the Chinese domestic market and an important market player in the world," Al Baker said in a statement.

China takes off

Air travel is growing rapidly in China. The International Air Transport Association expects the country to overtake the United States as the world's largest aviation market by 2023.

The surge in air travel is fueled in large part by middle class Chinese who are spending billions on domestic and foreign vacations.

Boeing (BA) expects Chinese airlines to purchase 7,690 new airplanes over the next 20 years, at a combined value of $1.2 trillion. Boeing estimates that 75% of the new planes will be single aisle aircraft.

Qatar's strategy

Qatar Airways has invested in a number of international airlines in recent years.

It owns 20% of International Airlines Group (ICAGY), the parent company of British Airways, as well as 10% stakes in Hong Kong carrier Cathay Pacific (CPCAY) and LATAM Airlines Group (LTM). It owns 49% of Air Italy.

The investments took on added importance after Qatar Airways was banned from some Middle East destinations following a breakdown of relations with neighbors such as Saudi Arabia and the United Arab Emirates in 2017.

Qatar Airlines operates across 1,000 airports in more than 150 countries, with 14,250 daily departures. China Southern did not respond to a request for comment on Wednesday.

Article Comments

Terre Haute
Clear
91° wxIcon
Hi: 91° Lo: 76°
Feels Like: 104°
Robinson
Scattered Clouds
89° wxIcon
Hi: 90° Lo: 76°
Feels Like: 104°
Indianapolis
Few Clouds
92° wxIcon
Hi: 92° Lo: 77°
Feels Like: 99°
Rockville
Clear
91° wxIcon
Hi: 91° Lo: 76°
Feels Like: 104°
Casey
Clear
89° wxIcon
Hi: 91° Lo: 76°
Feels Like: 100°
Brazil
Clear
91° wxIcon
Hi: 92° Lo: 76°
Feels Like: 104°
Marshall
Clear
91° wxIcon
Hi: 91° Lo: 76°
Feels Like: 104°
EXCESSIVE HEAT WARNING
WTHI Planner
WTHI Temps
WTHI Radar

Latest Video

Image

Dummy grenade deal gone bad leads to West Terre Haute shooting after suspect gets upset over a previ

Image

Terre Haute man charged with buying alcohol for teens leading to the shooting death of Garrett Sands

Image

The dangers of practicing in the heat

Image

What is an excessive heat warning?

Image

A One Woman Show

Image

7/18/19 Morning Weather

Image

Wes Kirk

Image

THJTA

Image

Junior Golf

Image

Mitch Hannahs

WTHI Events